NADA Applauds Government's Relief Package to Revitalize the Automobile Sector

NADA Automobiles Association of Nepal (NADA) warmly welcomes the relief package announced by the government to address the concerns of industries, businesses, and commercial establishments affected by the recent unusual circumstances during the Gen-Z movement. 

This decisive action sends a clear message that the government is committed to collaborating with the private sector to revive the country's economy.

A NADA delegation, led by President Karan Kumar Chaudhary, recently met with Prime Minister Sushila Karki and Finance Minister Rameshwar Khanal to request a special relief package to help the severely impacted automobile industry and businesses. 

The government's decision to address this request with high priority has boosted the morale of all business owners and entrepreneurs. This demonstrates that the government not only values the private sector's voice but is also ready to act on it immediately.

The automobile sector is a major contributor to Nepal's economy, creating thousands of jobs directly and indirectly, providing a significant portion of tax revenue, and serving as the backbone of a modern lifestyle and dynamic economy. 

However, recent events have dealt a major blow to the sector, with many showrooms, vehicles, warehouses, and properties damaged, supply chains disrupted, and customer confidence affected. The government's relief package provides great reassurance and encouragement during this difficult time.

Key Provisions Announced by the Government

• Advance Payments: A system has been established for a prompt advance payment of 50% of the damage to buildings, vehicles, goods, and machinery, based on the initial report from the insurance surveyor.
• Insurance Facilitation: Insurance companies will provide an advance payment of up to 50% if there are delays in the reinsurance process.
• Loan-to-Value (LTV) Ratio: For the purchase of new commercial vehicles or transport vehicles damaged in the protest, the LTV for bank loans will be a minimum of 80%.
• Customs and Excise Duty: A 50% discount on customs and excise duty will be provided for the import of goods to replace those damaged by arson or vandalism.
• Tax Benefits: Contributions to the National Reconstruction Fund can be counted as a tax deduction. The cost of uninsured stock can be deducted and calculated for tax purposes based on its valuation.
• Loan and Credit Support: The payment period for principal and interest will be extended for loan-affected industries and businesses. Affected businesses will also have access to loans at a concessional rate.
• Employment Protection: A Payroll Protection Scheme will be introduced to secure jobs, providing a 2% grant and concessional loans.
• Business Facilitation: Government offices, banks, and revenue collection agencies will remain open on holidays other than Dashain to facilitate business

While NADA welcomes these measures , it has also requested that the LTV facility be extended to all vehicles, not just those affected by the protests. This would help revive demand, increase investment flow through the banking system, secure jobs, and maintain government revenue. NADA remains hopeful that the government will make a positive decision on this soon.

NADA views the government's relief package as a clear sign of its commitment to listening to the business community and acting swiftly. We are committed to working hand-in-hand with the government to implement these provisions. This move is expected to strengthen trust between the industry, businesses, and the government.